Breach of contract: When one of the contracted parties fails in their obligations under the contract.
Certainty: The contract terms must be clear to both parties before signing.
Clauses: Specific provisions or sections within a written contract. Each clause in a contract addresses a specific aspect related to the overall subject matter of the agreement.
Contingency: A sum of money added to the contracted price to cover financial overruns.
Consideration: A thing of value exchanged between the contractual parties.
Contractor: The party hired to perform work or provide services.
Cooling off period: Number of days during which a buyer can change his or her mind and cancel a purchase agreement or return a purchased item for a full refund.
Defects liability period: A defects liability period is a set period of time after a construction project has been completed during which a contractor has the right to return to the site to remedy defects.
Discharge: The circumstances in which the contract is brought to an end. Where a contract is discharged, each party is freed from their continuing obligations under the contract.
Express terms: Terms that are explicitly spelled out in a contract.
Extension of time (EOT): This is a formal request, in writing, regarding a change in the date for completion of the project, brought about by some change in the project circumstances beyond the control of the contractor. This is permitted by the law for numerous valid reasons and depending on your contract’s time clause. Some examples of a valid reason can be:
- Delays in the delivery of important goods.
- The client has personally asked to start work at a later time.
- The client has requested variations in the scope of work.
- Unexpectedly bad weather conditions.
The contractor must be able to show sufficient evidence that the delay is caused by external factors and it is not due to underperformance.
Force Majeure: An unexpected and disruptive event that may operate to excuse a party from a contract, for example, a natural disaster.
Implied terms: Terms that can be implied from the contract. These are not specifically set out and may be open to dispute.
Intention: Both parties must intend to be bound by the contractual agreement.
Legal capacity:
- A person's authority under law to engage in a particular undertaking or maintain a particular status.
- A person’s capacity to make reasonable judgements.
Liabilities: The legal consequences of failing to complete the contractual obligations.
Limitations: Provisions in the contract that define boundaries of responsibilities for the contractor.
Liquidated damages:
- Pre-determined damages set at the time that a contract is entered into, based on a calculation of the actual loss the client is likely to incur if the contractor fails to meet the completion date.
- Monetary compensation.
Mediation: A dispute resolution process whereby a mediator discusses the matter with both parties and attempts to bring them together in agreement.
Obligations: The specific duties and legal responsibilities that the contractor agrees to perform as part of the contract.
Practical completion:
- The point where all building work is complete or all but completed, in accordance with the contract, and the building is reasonably fit for occupation.
- The stage where the work under the contract has been completed except for minor omissions and minor defects.
Principal: The party hiring the contractor.
Progress claim: Regular payments (usually fortnightly or monthly) from the client for materials delivered and work done on the site.
Specification:
- The written description of the works, or project, accompanying the drawings.
- An exact statement of the particular needs to be satisfied, or essential characteristics that a customer requires (in a good, material, method, process, service, system, or work) and which a vendor must deliver.
Tender: A sealed bid or offer document submitted in response to a request for tenders and containing detailed information on requirements and terms associated with a potential contract.
Termination: Clauses in the contract will set out the circumstances in which the contract may legally be ended.
Variation: Changes made in writing to items or terms of the contract due to unforeseen circumstances. Important details that should be included are work description, its technical specifications, and any additional costs if any. Variations must be ratified (confirmed by expressed consent) by all parties to the contract.
Active Listening: A communication technique that involves listening purposefully and actively engaging with the speaker.
Building Code: Any construction needs to adhere to the New Zealand Building Code. This specifies performance standards that all building work must meet.
Contractor: Temporary staff members brought into the project to perform a specific task.
Escrow: A document or sum of money held by the third party which is only released when a condition has been fulfilled.
Jargon: Specialised terminology used by a particular group or profession
Pepeha: A tool for introducing yourself in Te Reo Māori while establishing your identity and heritage.
Mana Whenua: The local Māori who have historically lived on the land where the construction project is taking place.
Non-verbal communication: Also called body language, this is the transmission of information without using words.
Scope creep: Occurs when additional requirements are added to the project after the planning stage is complete without control measures.
Subcontractor: A person who has a contractual agreement with the main contractor rather than with the project owner.
